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Indian Restaurant Business Plan
Indian Restaurant Business Plan
Welcome Restaurants USA Inc. a wholly owned subsidiary of Welcome Restaurants Private
Limited (Indian Parent Company) is looking to expand its operations by buying a 50% stake
in Indian Express Restaurant Inc., a New York corporation that currently owns and operates
a full service Indian restaurant in New York City. After the investment of $1,000,000 is
completed, Welcome Restaurants USA Inc. will look to expand the existing operations of
Indian Express and also look to open up to 2 more restaurants offering a delectable Indian
cuisine that blends foods from all parts of the Indian subcontinent. Given the excellent
management team and experience of the principals these ventures are sure to be profitable
and generate employment and revenues in the communities they serve.
Welcome Restaurants USA Inc. (US subsidiary) is a New York State Corporation and is a
wholly owned subsidiary of Welcome Restaurants Private Limited a corporation based in
Bangalore, India with interests in hospitality. Welcome Restaurants USA Inc. will be making
an investment of $1,000,000 to buy a 50% stake of Indian Express Restaurant Inc., a New
York corporation.
2.2 History
Welcome Restaurants Private Limited is the Parent company of Welcome Restaurants USA
Inc. Over the years Welcome Restaurants Private Limited has developed an expertise in the
hospitality and restaurant business and is now looking to expand overseas. With this strategic
focus a United States subsidiary called Welcome Restaurants USA Inc. was established in
August of 2007. The purpose of the subsidiary is to grow the Welcome brand internationally
by making strategic acquisitions and growing organically by opening new restaurants in the
United States.
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2.3 Start up Funding
Welcome Restaurants USA Inc. will begin its expansion into the United States market by
making a strategic acquisition and buying a 50% stake in the operations of Indian Express
Restaurant Inc. – a New York corporation. The funds will be used by Welcome Restaurants
USA Inc. to expand the existing operations of Indian Express Restaurant Inc. and also to start
two new restaurants in the New York metro area.
Welcome Restaurants USA Inc. will be making the investment of $1,000,000 from its own
cash reserves that are derived from the hospitality interests of its parent company Welcome
Restaurants Private Limited in Mumbai, India.
Welcome Restaurants USA Inc. will be purchasing a 50% stake in Indian Express Restaurant
Inc. located at 147 West, 16th Street between Park and Lexington Avenues, New York, NY
10016.
Welcome Restaurants USA Inc. through its investment in Indian Express Restaurant Inc. will
be able to offer its clientele a unique blend of Indian cooking – different from the typical North
or South Indian fare dished out by most restaurants. Using the concept of fusion cooking,
Welcome will be able to present unique and eclectic assortments of appetizers, entrees and
deserts that are rare to find in a typical Indian restaurant.
With its incredibly diverse population New York City is able to support many restaurants
serving up different varieties of foods. The Indian full service restaurant is no different and
New York City currently boasts around 200 restaurants that serve some kind of India fare.
However of the 200 odd full service Indian restaurants the vast majority of them focus on
providing the traditional and dependable delicacies of North Indian cooking; around 20% of
the all Indian restaurants offer South India delicacies and very few of them are true
competitors to Welcomes Hotels USA Inc. Given the unique blend of foods from the entire
sub-continent Welcome Restaurants USA Inc. will be able to offer improved derivatives of
classic Indian cooking.
New York City is widely regarded as the most culturally diverse city in the United States with
a population that boasts residents from all over the world. Also New York City has a much
higher per capital income and median household income when compared to the average for
the country.
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4.1 Target Market: Population, Household Statistics Summary (cont'd)
Population & Household & Business statistics summary for New York, NY
Minority owned businesses are well represented in New York City as we can see with Black,
Hispanic and women owned firms running better than the national averages. Having a diverse
population is key to the success of Welcome Restaurants USA Inc. since Indian food is most
appealing to clients who prefer diversity in their food habits.
Retail sales per capita – another measure of the spending power of local New York City
residents is $16,178 a good 57% above the national average retail sales per capita of
$10,615. This again bodes well for us in the restaurant business.
The Age chart below highlights the fact that New York City has a good share of its population
between the ages of 18 and 65 – a good 64% - higher than the national average of 61%. We
believe that is an important element of success in the restaurant business since this is the
age group that is most likely to have disposable income and eat away from their homes.
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The race graph below simply reiterates the earlier mentioned diversity that New York City has
come to be known for. With 24% of its population claiming Hispanic origin and 11% and 18%
claiming Asian and Black heritage, NYC offers restaurants serving Indian foods like ours an
excellent client base.
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4.4 Target Market: Income & Housing Demographics
The Income distribution of households in New York City shows a substantial amount of
households earning between $35k and $100k – what is very important however is to
understand that in New York City the composition of households is very different from the
rest of the country. For example only 39% of the population in New York City is married
versus 52% for the national average. A lot more single people means a lot less cooking at
home!
With more 4 year college students and graduates than the national average, New York City
easily stands out as having a population of relatively better educated citizens. For restaurants
serving ethnic cuisine like Indian foods this is a very important element in the marketplace.
We strongly believe that fusion Indian cooking is well received by clients with relatively higher
education and economic backgrounds.
A quick look at the occupations of the New York City residents clearly shows a relatively high
proportion of the workforce involved in Management and Professional occupations. Since the
office crowd is a very important element of our revenues and brings in almost 40% of our
total income, we think that this demographic pattern works very well in our favor.
In the following table we have analyzed the major trends that affect our industry and that is
the amount spent by households. While the larger survey deals with monies spent by a
household on every item, we have decided to focus on the part that matters the most to us
and that of course the amount of money spent by households nationally on foods away from
home.
In 1997 we find that out of the total 104 million households in the nation the average annual
expenditure was approximately $33k per household. Of this $2,876 or roughly 8.50% of the
total household expenditure was spent on foods consumed at home. Another $1,823 or
roughly 5.40% was spent on foods away from home. Also, $ 309 or roughly 0.90% was spent
on alcoholic beverages.
When we look at 2007 we find that out of the 118 million households in the nation, the average
annual expenditure is $48,398. Of this $ 3,417 or 7.06% of the total expenditure was spent
on food consumed at home. Another $2,694 or roughly 5.60% was spent on food away from
home. Alcoholic beverages consumption remained roughly the same at 1% or $497 in 2007.
The most important trend that matters to us is of course the expenditure on foods away from
home. It is significant to note that while this expense of 5.60% of total expenditure does not
mean that all the money is spent on full service restaurants let alone fine Italian dining, it
does however show that the consumers preferences nationally towards eating out have not
changed significantly between 1996 and 2007.
Clearly, as long as this trend of consumption of food away from home continues, all food
purveyors including fast food shops, limited service restaurants and full service restaurants
like us will do well. It is important to note that the 10 year period covered above does not
cover a protracted recession but does include the slowdown of 2001 – 2002 during which the
spending habits of the national population did not change towards outside food consumption.
No. of Expenditure:
households Avg. Annual Expenditure: food away from Expenditure on Alcoholic
Year (000) Expenditure food at home home Total Expenditure on food beverages
We believe that in today’s competitive full service restaurant business there are three things
that are keys to success:
We believe that at Welcome Restaurants USA we have all three elements down pat! Our
choice of locations is the city of New York. A business friendly local government coupled with
a highly educated, well heeled population is the perfect venue for fine Indian dining offered
by Welcome Restaurants USA and Indian Express Restaurants.
Our diverse menu selection during both lunch and dinner hours has been developed after
years of experience in the industry by our chefs. Care has been taken to pick crowd pleasers
and house specials that are not easy to find in Indian dining and the fare is priced very
reasonably in line with local competitors.
5.2 Positioning
We are positioning ourselves to market to the middle to upper middle class clientele of well
heeled working professionals who live and work in New York City. Our typical customer is well
educated having a graduate degree, working and/or living in New York city, looking for a
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tasteful and different Indian dining experience than what is offered by the local deli.
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Our media advertising will be focused on publications serving the Indian community
“India Abroad” and “Desi Talk”.
Our online advertising will be focused on websites like Citysearch.com, yelp.com,
restaurant.com and seamless web.
Local promotions will also include sponsorship of local charity events and participating
in food drives and other local causes.
We currently have an alliance with Seamless web that allows clients to place their orders via
the web. We have been able to mind a steady base of customers from local firms like Credit
Suisse, JP Morgan Chase, Metlife and other non-institutional clients as well.
There are two ways to approach sales – one is go with volume and this is the typical modus
operandi of the fast food industry; many full service restaurants also use this approach. The
other is go with quality service at market rates but focus on building a richer customer dining
experience so that we can cultivate a permanent relationship with the customer. We favor the
later approach at Welcome Restaurants USA Inc.
We believe that it is very important to be realistic in the projection of sales in the planning
process and have decided to look at three possible market scenarios in our sales projections.
Slow market: As the words imply, this would indicate a weak market for the full service
restaurant business as was the case after the attack of September 11, 2001 where the
full service restaurant business suffered its worse days in recent memory. This
experience is also possible during a recession where folks decide to be cautious with
their disposable income.
Good market: This would be a regular and normal environment during which healthy
business activity can be experienced by us in the full service restaurant business.
Great market: This would suggest an excellent operating environment with the
consumer feeling very confident and spending on food away from home a lot more
than normal. The dot com era of the late nineties was such an operating environment
where full service restaurants did extremely well.
Also indicated in our projections are the seasonal adjustments that are normal in our
business with January to March being tepid, business picking up in June and July, and
of course the best time for us being the holiday months of November and December.
We have also indicated projections for 1, 2 and 3 restaurants. Our first initiative is to
the expand the operations of Indian Express Restaurant Inc. Once we have
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Apr $105,000 $210,000 $315,000 $131,250 $262,500 $393,750 $150,938 $301,875 $452,813
May $120,000 $240,000 $360,000 $150,000 $300,000 $450,000 $172,500 $345,000 $517,500
Jun $150,000 $300,000 $450,000 $187,500 $375,000 $562,500 $215,625 $431,250 $646,875
Q2 $375,000 $750,000 $1,125,000 $468,750 $937,500 $1,406,250 $539,063 $1,078,125 $1,617,188
Jul $135,000 $270,000 $405,000 $168,750 $337,500 $506,250 $194,063 $388,125 $582,188
Aug $105,000 $210,000 $315,000 $131,250 $262,500 $393,750 $150,938 $301,875 $452,813
Sep $135,000 $270,000 $405,000 $168,750 $337,500 $506,250 $194,063 $388,125 $582,188
Q3 $375,000 $750,000 $1,125,000 $468,750 $937,500 $1,406,250 $539,063 $1,078,125 $1,617,188
Oct $135,000 $270,000 $405,000 $168,750 $337,500 $506,250 $194,063 $388,125 $582,188
Nov $150,000 $300,000 $450,000 $187,500 $375,000 $562,500 $215,625 $431,250 $646,875
Dec $195,000 $390,000 $585,000 $243,750 $487,500 $731,250 $280,313 $560,625 $840,938
Q4 $480,000 $960,000 $1,440,000 $600,000 $1,200,000 $1,800,000 $690,000 $1,380,000 $2,070,000
Tot $1,500,000 $3,000,000 $4,500,000 $1,875,000 $3,750,000 $5,625,000 $2,156,250 $4,312,500 $6,468,750
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5.6 Sales Projections (cont'd)
Apr 110,250 $220,500 $330,750 137,813 $275,625 $413,438 158,484 $316,969 $475,453
May 126,000 $252,000 $378,000 157,500 $315,000 $472,500 181,125 $362,250 $543,375
Jun 157,500 $315,000 $472,500 196,875 $393,750 $590,625 226,406 $452,813 $679,219
Q2 393,750 $787,500 $1,181,250 492,188 $984,375 $1,476,563 566,016 $1,132,031 $1,698,047
Jul 141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531 $611,297
Aug 110,250 $220,500 $330,750 137,813 $275,625 $413,438 158,484 $316,969 $475,453
Sep 141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531 $611,297
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Oct 141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531 $611,297
Nov 157,500 $315,000 $472,500 196,875 $393,750 $590,625 226,406 $452,813 $679,219
Dec 204,750 $409,500 $614,250 255,938 $511,875 $767,813 294,328 $588,656 $882,984
Q4 504,000 $1,008,000 $1,512,000 630,000 $1,260,000 $1,890,000 724,500 $1,449,000 $2,173,500
Total 1,575,000 $3,150,000 $4,725,000 1,968,750 $3,937,500 $5,906,250 2,264,063 $4,528,125 $6,792,188
Apr $115,763 $231,525 $347,288 $144,703 $289,406 $434,109 $166,409 $332,817 $499,226
May $132,300 $264,600 $396,900 $165,375 $330,750 $496,125 $190,181 $380,363 $570,544
Jun $165,375 $330,750 $496,125 $206,719 $413,438 $620,156 $237,727 $475,453 $713,180
Q2 $413,438 $826,875 $1,240,313 $516,797 $1,033,594 $1,550,391 $594,316 $1,188,633 $1,782,949
Jul $148,838 $297,675 $446,513 $186,047 $372,094 $558,141 $213,954 $427,908 $641,862
Aug $115,763 $231,525 $347,288 $144,703 $289,406 $434,109 $166,409 $332,817 $499,226
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Sep $148,838 $297,675 $446,513 $186,047 $372,094 $558,141 $213,954 $427,908 $641,862
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Total 1,653,750 $3,307,500 $4,961,250 2,067,188 $4,134,375 $6,201,563 2,377,266 $4,754,531 $7,131,797
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5.7 Milestones
Presented here are the key milestones in our business plan for Mayflower Restaurants USA
Inc. Upon receiving the regulatory okay for Mr. Patel from the USCIS we will begin the process
making our investment into Indian Express Restaurants Inc. and also the expansion of the
business interests into other restaurants as described earlier.
Week of 1 2 3 4 5 6 7 8 9
10/6/2008
10/13/2008
10/20/2008
10/27/2008
11/3/2008
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11/10/2008
11/17/2008
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11/24/2008
12/1/2008
12/8/2008
12/15/2008
12/22/2008
12/29/2008
1/5/2009
1/12/2009
1/19/2009
1/26/2009
2/2/2009
2/9/2009
2/16/2009
2/23/2009
3/2/2009
3/9/2009
3/16/2009
3/23/2009
3/30/2009
4/6/2009
4/13/2009
4/20/2009
4/27/2009
5/4/2009
1 2 3 4 5 6 7 8 9
Starting
No. Name of Project Week Ending Week Responsible Party
1 Filing of L-1 Petition 10/6/2008 10/13/2008 Attorney
2 Processing & Approval of L-1 10/20/2008 12/29/2008 USCIS
3 Indian Express Investment 1/5/2009 1/5/2009 Welcome Hotels USA Inc.
4 Expansion of existing business 1/12/2009 5/4/2009 Satish Patel
5 New Site Research 4/6/2009 ongoing Satish Patel
6 Market Research 4/6/2009 ongoing Satish Patel
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As indicated in our earlier discussions, we expect that with the opening of other restaurants
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the total income for our combined new operations will be substantial more than the current
income for the Indian Express Restaurant that will be controlled by Welcome Restaurants USA
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Inc. Our pro-forma financials have been put together with a very conservative growth with
only one of restaurant to give investors and banks a better idea of the profitability in an
average environment with a steady growth rate consistent with our peers in the restaurant
business. We would like to point out however that we anticipate a significantly better sales
picture as indicated in our sales projections.
OPERATING EXPENSES
Accounting & Legal Fees $9,375 $9,656 $9,946
Advertising $18,750 $19,688 $20,672
Auto Expenses $5,438 $5,546 $5,657
Bad Debts $18,750 $18,938 $19,127
Bank charges $5,250 $5,303 $5,356
Credit card processing $37,500 $38,250 $39,015
Catering & Banquet Supplies $4,688 $4,781 $4,877
Cleaning / Janitorial Services $5,625 $5,794 $5,968
Depreciation $34,700 $34,700 $34,700
Charitable Donations $5,000 $5,000 $5,000
Employer Taxes $33,240 $34,902 $36,647
Entertainment $5,625 $5,738 $5,852
Extermination $4,875 $5,021 $5,172
Flowers & Decoration $4,688 $4,828 $4,973
Gifts $14,063 $14,063 $14,063
Gross Wages $349,891 $367,385 $385,754
Insurance $18,750 $19,313 $19,892
Kitchen Utensils $4,688 $4,828 $4,973
Linen & Laundry $5,250 $5,408 $5,570
Miscelleaneous Expenses $5,063 $5,164 $5,267
Musician / Music $5,625 $5,738 $5,852
Paper & Printing Services $6,563 $6,694 $6,828
Rent $210,000 $220,500 $231,525
Office Expenses $4,688 $4,922 $5,168
Office Supplies $10,000 $10,200 $10,404
Subscriptions, Licenses & Fees $4,125 $4,331 $4,548
Security & Computer maintenance $2,813 $2,869 $2,926
Tableware / Cutlery $5,625 $5,794 $5,968
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A S S E T S
FIXED ASSETS
Furniture, Fixtures & Equipment $347,000 $347,000 $347,000
Accumulated Depreciation -$34,700 -$69,400 -$104,100
Security Deposit $35,000 $35,000 $35,000
TOTAL FIXED ASSETS $347,300 $312,600 $277,900
L I A B I L I T I E S & C A P I T A L
Taxes Payable $0 $0 $0
Other Current Liabilities $0 $0 $0
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CAPITAL
Common Stock $1,000,000 $1,000,000 $1,000,000
Retained Earnings $214,696 $460,202 $738,821
TOTAL CAPITAL $1,214,696 $1,460,202 $1,738,821
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